Justifying the logic of regulatory post-crisis decision-making – The case of the French structural banking reform

Margit Munzer

CRITICAL PERSPECTIVES ON ACCOUNTING, 2019, vol. 60, issue C, 44-64

Abstract: Relying on the theories of institutional logics (Friedland and Alford) and French pragmatist sociology (Boltanski and Thévenot), this study aims to contribute to a deeper understanding of the dynamics of the regulatory rule-making processes in the aftermath of the financial crisis. It focuses on a national post-crisis financial market reform, namely the French structural banking reform of 2013, which is characterized by a remarkable discrepancy between the ambitious announcements that accompanied the reform and its actual impact on banks’ structure. By analysing the justifications put forward by policy-makers in support of their decisions on the amendments to the bill, this paper investigates how policy-makers succeeded in maintaining and defending the historically dominant logic (i.e., market) in a situation of controversy by actively mobilizing different orders of worth. Complex mechanisms of reconciliation between orders of worth are revealed. In particular, the study identifies the strategy of symbolization of the competing order as a means of supporting the dominating logic in the context of a national post-crisis financial market reform. The technique of balancing different measures with diverging impacts on the banking sector enables the policy-makers to refer to a (symbolic) equilibrium solution, which shields their actions against criticism and helps them to achieve legitimacy.

Keywords: Banking regulation; Institutional logics; Orders of worth; Justification (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:eee:crpeac:v:60:y:2019:i:c:p:44-64

DOI: 10.1016/j.cpa.2018.08.001

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